Nuremberg Trial Judgements:
Hjalmar Schacht

Schacht is indicted under Counts One and Two of the Indictment.
Schacht served as Commissioner of Currency land President of the Reichsbank
from 1923 to 1930; was reappointed President of the bank on 17th March, 1933; Minister
of Economics in August, 1934;
and Plenipotentiary General for War Economy in May, 1935.
He resigned from these two positions in November, 1937,
and was appointed Minister without Portfolio. He was reappointed as
President of the Reichsbank for a one-year term on 16th March, 1937,
and for a fourth term on 9th March, 1938,
but was dismissed on 20th January, 1939.
He was dismissed as Minister without Portfolio on 22nd January, 1943.

Crimes against Peace

Schacht was an active supporter of the Nazi
Party before its accession to power on 30th January, 1933, and supported
the appointment of Hitler to the post of Chancellor. After that date he played an important role
in the vigorous rearmament programme which was adopted, using the facilities
of the Reichsbank to the fullest extent in the German rearmament effort.
The Reichsbank, in its traditional capacity as financial agent for the
German Government, floated long-term Government loans, the proceeds
of which were fused for rearmament. He devised a system under which
five-year notes, known as M.E.F.O. bills, guaranteed by the Reichsbank
and backed, in effect, by nothing more than its position as a bank of
issue, were used to obtain large sums for rearmament from the short-term
money market. As Minister of Economics and as Plenipotentiary General
for War Economy he was active in organising the German economy for war.
He made detailed plans for industrial mobilisation and the coordination
of the Army with industry in the event of war. He was particularly concerned
with shortages of raw materials and started a scheme of stock-piling
and a system of exchange control designed to prevent Germany's weak
foreign exchange position from hindering the acquisition abroad of raw
materials needed for rearmament. On 3rd May, 1935, he sent a memorandum
to Hitler stating that " the accomplishment of the armament programme
with speed and in quantity is the problem of German politics, that everything
else therefore should be subordinated to this purpose."

Schacht, by April, 1936, began to lose his influence
as the central figure in the German rearmament effort when Goering was appointed Coordinator for Raw Materials and Foreign Exchange. Goering
advocated a greatly expanded programme for the production of synthetic
raw materials which was opposed by Schacht on the ground that the resulting
financial strain might involve inflation. The influence of Schacht suffered
further when on 16th October, 1936,
Goering was appointed Plenipotentiary for the Four-Year Plan with the
task of putting " the entire economy in a state of readiness for
war " within four years. Schacht had opposed the announcement of
this plan and the appointment of Goering to head it, and it is clear
that Hitler's action represented a decision that Schacht's economic
policies were too conservative for the drastic rearmament policy which
Hitler wanted to put into effect.

After Goering's appointment, Schacht and Goering promptly
became embroiled in a series of disputes. Although there was an element
of personal controversy running through these disputes, Schacht disagreed
with Goering on certain basic policy issues. Schacht, on financial grounds,
advocated a retrenchment in the rearmament programme, opposed as uneconomical
much of the proposed expansion of production facilities, particularly
for synthetics, urged a drastic tightening on government credit and
a cautious policy in dealing with Germany's foreign exchange reserves.
As a result of this dispute and of a bitter argument in which Hitler
accused Schacht of upsetting his plans by his financial methods, Schacht
went on leave of absence from the Ministry of Economics on 5th September,
1937, and resigned as Minister of Economics and as Plenipotentiary General
for War Economy on 16th November, 1937.

As President of the Reichsbank, Schacht was still involved
in disputes. Throughout 1938, the Reichsbank continued to function as
the financial agent for the German Government in floating long-term
loans to finance armaments. But on 31st March, 1938, Schacht discontinued
the practice of floating shortterm notes guaranteed by the Reichsbank
for armament expenditures. At the end of 1938, in an attempt to regain
control of fiscal policy through the Reichsbank, Schacht refused an
urgent request of the Reichsminister of Finance for a special credit
to pay the salaries of civil servants which were not covered by existing
funds. On 2nd January, 1939, Schacht held a conference with Hitler at
which he urged him to reduce expenditures for armaments. On 7th January,
1939, Schacht submitted to Hitler a report signed by the Directors of
the Reichsbank which urged a drastic curtailment of armament expenditures

and a balanced budget as the only method of preventing
inflation. On 19th January, Hitler dismissed Schacht as President of
the Reichsbank. On 22nd January, 1943, Hitler dismissed Schacht as Reich
Minister without Portfolio because of his " whole attitude during
the present fateful fight of the German nation." On 23rd July,
1944, Schacht was arrested by the Gestapo and confined in a concentration
camp until the end of the war.

It is clear that Schacht was a central figure in Germany's
rearmament programme, and the steps which he took, particularly in the
early days of the Nazi regime, were responsible for Nazi Germany's rapid
rise as a military power, But rearmament of itself is not criminal under
the Charter. To be a crime against peace under Article 6 of the Charter
it must be shown that Schacht carried out this rearmament as part of
the Nazi plans to wage aggressive wars.

Schacht has contended that he participated in the rearmament
programme only because he wanted to build up a strong and independent
Germany which would carry out a foreign policy which would command respect
on an equal basis with other European countries; that when he discovered
that the Nazis were rearming for aggressive purposes he attempted to
slow down the speed of rearmament, and that after the dismissal of von
Fritsch and von Blomberg he participated in plans to get rid of Hitler,
first by deposing him and later by assassination

Schacht, as early as 1936, began to advocate a limitation
of the rearmament programme for financial reasons. Had the policies
advocated by him been put into effect, Germany would not have been prepared
for a general European war. Insistence on his policies led to his eventual
dismissal from all positions of economic significance in Germany. On
the other hand, Schacht, with his intimate knowledge of German finance,
was in a peculiarly good position to understand the true significance
of Hitler's frantic rearmament, and to realise that the economic policy
adopted was consistent only with war as its object.

Moreover Schacht continued to participate in German
economic life and even, in a minor way, in some of the early Nazi aggressions.
Prior to the occupation of Austria he set a rate of exchange between
the mark and the schilling. After the occupation of Austria he arranged
for the incorporation of the Austrian National Bank into the Reichsbank
and made a violently pro-Nazi speech in which he stated that the Reichsbank
would always be Nazi as long as he was connected with it, praised Hitler,
defended the occupation of Austria, scoffed at objections to the way
it was carried out, and ended with " to our Fuehrer a triple '
Sieg Heil '." He has not contended that this speech did not represent
his state of mind at the time. After the occupation of the Sudetenland,
he arranged for currency conversion and for the incorporation into the
Reichsbank of local Czech banks of issue. On 29th November 1938, he
made a speech in which he pointed with pride to his economic policy
which had created the high degree of German armament, and added that
this armament had made Germany's foreign policy possible.

Schacht was not involved in the planning of any of
the specific wars of aggression charged in Count Two. His participation
in the occupation of Austria and the Sudetenland (neither of which are
charged as aggressive wars) was on such a limited basis that it does
not amount to participation in the common plan charged in Count One.
He was clearly not one of the inner circle around Hitler which was most
closely involved with this common plan. He was regarded by this group
with undisguised hostility. The testimony of Speer shows that Schacht's
arrest on 23rd July, 1944, was based as much on Hitler's enmity towards
Schacht growing out of his attitude before the war as it was on suspicion
of his complicity in the bomb plot. The case against Schacht therefore
depends on the inference that Schacht did in fact know of the Nazi aggressive
plans.

On this all important question evidence has been given
for the prosecution, and a considerable volume of evidence for the defence.
The Tribunal has considered the whole of this evidence with great care,
and comes to the conclusion that this necessary inference has not been
established beyond a reasonable doubt.

Conclusion

The Tribunal finds that Schacht is not guilty on this
Indictment, and directs that he shall be discharged by the Marshal,
when the Tribunal presently adjourns.